The New Retail Evolution
In 2019, the term “Retail Apocalypse” is being thrown around with ubiquitous intentions of doom and gloom while having everyone believe that in five years, there will hardly be any brick and mortar retailers left. I feel that there is a larger dynamic that is happening within the retail sector. The retail sector is experiencing a recorrection and is going through a transitional period that will lead to homeostasis. It appears that all of the press about the retail sector is depressing and disheartening however, I feel that there is an overabundance of positive examples that are being overshadowed by the deluge of disproportionate coverage.
“We are experiencing a New Retail Ethos which is facilitating a changing of the guard. It is forcing many retailers to adapt and innovate.”
There are many retail organizations that are adapting, adjusting, and acclimating to this tumultuous new retail arena, which through massive disruption, has spawned a renewed sense of passion and desire to transcend the legacy mentality that has existed for over 100 years. The Home Depot, Walmart, Target, Best Buy, Costco, Macy’s, Old Navy, TJ Maxx, Kroger, and Publix are pivoting exceptionally well through differentiation, strong brand awareness, and outstanding organizational culture. Honorable mention for Lowes as they are on the right track.
We are experiencing a New Retail Ethos which is facilitating a changing of the guard. It is forcing many retailers to adapt and innovate. They have the opportunity to rise from the ashes with a stronger foothold within their respective niche while foraging into uncharted territories. This, in turn, will galvanize their employees, leaders, vendors, and customers.
I have the utmost respect for the executive/c-suite retail leaders today. After all, they are faced with the daunting task of evolving within an aggressive new arena that has never been witnessed before within the retail sector. The C-suite leaders are experiencing an all-out attack from every angle (Amazon, Omni-channel, younger generational shopping patterns, and digital curation) with no historical data to guide them. This new retail arena is subjecting many retailers to confront a precipitous drop in revenue, decreased brand awareness, diminishing net income levels, and declining customer foot traffic.
Until the 2010s, most retailers followed similar successful strategies while the foremost difference (for success or failure) was the efficacy of executing those stratagems. In today’s digital world, the customer is afforded a cornucopia of choices when deciding to purchase retail items. This is confounding many retailers with the acceleration of numerous innovative, immersive, and visceral experiences that are altering the retail landscape forever. We have entered a New Retail Evolution.
RETAIL RESOURCE TO ASSIST LEADERS
It is humbling to see so many people resonating with my new book: The Ultimate Retail Manual. It brings me great joy to share the knowledge that I gleaned during my thirty-year tenure within the retail sector as an executive leader with others. I wrote the book to assist other retail/business leaders with adjusting, adapting, and acclimating to the New Retail Ethos we are experiencing in the retail sector.
“In addition, the retail manual has an international presence that is resonating with readers in Germany, Mexico, UK, France, Italy, Ireland, Canada, and Australia.”
What an honor to share The Ultimate Retail Manual with other countries around the world. In addition, the retail manual has an international presence that is resonating with readers in Germany, Mexico, UK, France, Italy, Ireland, Canada, and Australia.
I felt compelled to write this book because I remember the feeling of being utterly overwhelmed by the breadth of knowledge that is required to become a true servant leader in a retail or business environment.
WHAT IS GOING ON IN THE RETAIL SECTOR
WE ARE OVER-RETAILED
According to data compiled by the advisory firm Cowen and Company, “the US has about 23.5 square feet of retail space per capita, compared to 16.8 square feet of retail space per capita in Canada, and 11.2 square feet of retail space per capita in Australia.” We simply have too many retail stores for our new retail environment. With the proliferation of the internet and online shopping options, customers do not require as many retail locations anymore. Through this re-correction, the retail sector is slowly readjusting to the changing retail climate.
ONLINE PLAYERS OPENING UP PHYSICAL STORES
The retail sector is experiencing major disruption from “Digitally Native Company’s.” Think, Casper, Indochino, Fabletics, Warby Parker, Bonobos. It can be infinitely more expensive to acquire a new customer online then it is with a physical store. The pure online players are starting to realize that the physical stores have a powerful tool at their disposal; the power of engagement with the product. This is increasing competition among legacy retailers who are not adequately equipped (yet) to handle the seamless execution of the omnichannel platform that customers are expecting. Digital players have already mastered the omnichannel experience because that was the lifeblood of their business.
EVOLUTION BACK TO EXPERIENTIAL RETAIL
Consumer shopping patterns are evolving in the digital age which are requiring retailers to take a hard look at their core standards regarding customer engagement. Customers are demanding that retailers incorporate new experiences into their offerings by adapting their store formats accordingly. Shoppers are increasingly seeking a multisensory experience, which is an experience that stimulates all five senses while creating an emotional attachment/connection to the brand.
“Experiential retail is a concept that has its roots firmly planted in coercing shoppers back into stores to facilitate increased store visits.”
The number one advantage that brick-and-mortar retailers have that Amazon does not is a hands-on, enthralling, and interactive platform. In essence, stores provide experiences that cannot be replicated by an online business. Experiential retail is a concept that has its roots firmly planted in coercing shoppers back into stores to facilitate increased store visits. This can encourage customer loyalty, maximize top-line revenue, and establish brand awareness within the ultra-competitive retail sector.
The permanent optimist within me concludes that this transformation will evolve into a more dynamic, inclusive, and entertaining proposition for the retailers who can adapt. The universe, just like the retail sector, is fundamentally a concept of duality where each environment seeks to correct itself through adaptation to acclimatize to its intended balanced nature.
RETAILERS ARE STRUGGLING TO ATTRACT & RETAIN TOP-TIER TALENT
In this extremely tight labor market, the pool for highly qualified and competent retail leaders is razor thin and the competition to hire these individuals is fierce. The retail sector is already notorious for having an undesirable schedule, just like the restaurant industry, (nights, weekends, and holidays.) Moreover, when you throw in the length of time per day (anywhere between 10-12 hours is the minimum requirement) that many salaried leaders are required to work, then you are creating an environment where many leaders can become disgruntled and dissatisfied with their careers. Over time, this will have a direct impact on each retail store.
“Many retailers are going to have to loosen their “Kung Fu grip” on their antiquated protocols surrounding work/life balance for their leaders.”
Retailers should transition away from dealing in absolutes (all or nothing) regarding their rigid expectations for their salaried leaders 50-55-hour minimum work schedules. I have always believed in an even exchange of energy while constantly seeking out win-win scenarios for all parties involved. Many retailers are going to have to loosen their “Kung Fu grip” on their antiquated protocols surrounding work/life balance for their leaders. Most leaders that I have spoken with feel that a 40-45-hour workweek would create a “goldilocks syndrome.” This would allow each leader to have balance in their lives to spend with family and friends, pursue their hobbies, exercise, volunteer, and recharge their batteries. This would create a proverbial win-win scenario for all parties!
Read the first part of The New Retail Evolution here.